Whilst the focus has rightly been on keeping the planning system and development world working during the current pandemic, it is worth keeping in mind that housing needs will still need to be met (perhaps even more so given the likely economic impacts on individuals and families of the pandemic) and that the economy is going to need development to assist in the restoration of some of the financial damage caused by the pandemic.
There will clearly therefore be opportunities for landowners and developers to help deliver housing quickly once the country begins to get back to normal. This article looks at the current housing land supply position and the implications of any failure to continue to grant residential planning permissions and deliver sufficient housing. It assumes that the reader is familiar with the basics of housing land supply and its policy context.
This article will look into the housing land supply position for local planning authorities (LPAs) in England, looking at the pre-pandemic position with the recent release of the Housing Delivery Test (HDT) results, annual position statements and the Secretary of State’s treatment of housing land supply. Finally, this article assesses the predicted impact of the pandemic on housing and land supply.
Recently and pre-pandemic (although it already seems a different epoch), there was much research by leading planning consultancies (including Savills, WSP and Indigo) on the level of housing land supply on a national and LPA basis. The headlines include that, across England, there is a housing land supply of 6.4 years, up from 6.1 years in April 2018. This is the third consecutive year of an increase in published housing land supply.
Some other interesting headlines include:
The HDT aims to measure how effectively each LPA is delivering housing. It works by comparing each LPAs level of housing delivery - using the net additional dwelling figures - over a three-year period to demonstrate the total number of homes delivered.
The latest test results published on the 13th February 2020 showed that 109 LPAs (or 33%) scored under 95%. As a result these LPAs will face the consequences of having to produce an action plan showing how they will improve their housing delivery performance over the next year.
Of these, 83 LPAs fall under the 85% threshold which means that for the purposes of calculating their housing land supply position, they will have to find an additional buffer of 20% dwellings on deliverable housing sites. An additional 8 LPAs face the most severe consequences as they fall under the 45% delivery threshold which means automatic application of the National Planning Policy Framework’s (NPPF) tilted balance. The eight included Three Rivers (who had a measurement of just 41%), North Hertfordshire (with 44%) and Basildon (with 44%) Councils.
In accordance with the NPPF, it is possible for LPAs to ‘confirm’ (fix) their five year housing land supply through an annual position statement approved on 1 April each year or through a recently adopted Local Plan. An annual position statement can only be approved following stakeholder consultation and if it incorporates any recommendations of the Secretary of State. Once approved, the LPAs five year housing land supply position cannot be challenged on appeal.
The first opportunity to go through this process was in 2019 and then only one LPA, Wyre Council, has demonstrated sufficient supply (5.18 years) to successfully confirm (until 31 October 2020) an annual position statement. Both Mid Sussex and Flyde’s statements were rejected by inspectors.
The annual position statement procedure does not appear popular this year either as only six LPAs (Fylde Borough Council, Milton Keynes Council, South Kesteven District Council, Stockton on Tees Borough Council, Sunderland City Council and Wyre Council) have indicated that they indent to submit an annual position statement by 1 April 2020.
We expect this is probably due to the ability, as confirmed in the PPG, to rely on the latest available evidence to demonstrate a five year housing land supply and the scrutiny that an annual position statement would be subject to if submitted.
On appeal, there have been a number of key points which have been dealt with by the Secretary of State as follows:
The impacts of the pandemic on housing supply and delivery will largely turn on how long the pandemic lasts, how successful the development world is in granting planning permission (and discharging conditions including reserved matters approvals) and delivering housing (particularly in the context of many sites currently being in shutdown), and whether the Government considers it necessary to legislate and/or update national policy to reflect the impact of the pandemic on housing supply and delivery.
As it stands, it is likely that many LPAs will increasingly struggle to comply with the HDT thresholds, especially given that the threshold for triggering the tilted balance is due to increase to 75% in November 2020 (up from 45% for November 2019).
A very simplistic way of looking at it is that a period of 3 months during which no housing is delivered represents no delivery for circa 8% of the HDT period, which could well mean that those LPAs failing to hit 85% for the latest HDT results (see above) could find themselves slipping close to the new 75% threshold from November 2020.
Unless the Government steps in, the pandemic may contribute towards LPAs failing the 75% trigger for the HDT in 2020 meaning that the tilted balance will be applied and opportunities to secure planning permission, particularly on unallocated sites, will arise. This is, of course, assuming that the HDT figures arrive in November 2020 and are not delayed as they have been on previous occasions.
With regard to housing land supply, unless LPAs find alternative ways of making decisions, the inevitable reduction in granting permissions clearly has the scope to seriously undermine housing land supply. In this regard, there will be many LPAs who are likely to struggle to demonstrate a five year housing land supply and so there may be increasing opportunities for developers, promoters and landowners to bring sites forward to add to what is likely to be much needed supply.
There is currently no indication that the Government is proposing amendments to legislation or policy to address the implications for housing land supply and/or the application of the HDT. As a result, it is likely that many LPAs will in the short/medium term, struggle to comply with the requirements of current policy to demonstrate a 5 year supply of deliverable housing sites (with appropriate buffer) meaning that opportunities to bring forward residential development may be increasingly available to landowners, promoters and developers who are able to bring forward schemes quickly.
Whilst this may appear harsh on LPAs, one must not lose sight of the fact that the country continues to face a substantial housing shortage which is only likely to get worse as a result of the pandemic and it would be simply unrealistic and detrimental, both to those individuals and families in need of housing and to the economy (local and national), to strictly adhere to a plan led approach in such circumstances.
Indeed one of the challenges posed by the current shutdown is the inherent challenge in progressing Local Plans quickly and efficiently.
Short term action will undoubtedly be required and landowners, promoters and developers should continue to explore opportunities to enable them to move quickly in recommencing or starting development on sites and bringing new sites to the market when things start to get back to normal.
If you require any further information or advice please do not hesitate to contact a member of the Planning team at Howes Percival.
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